INVOLVE was incorporated as a not-for-profit voluntary health and welfare organization on January 1, 2020 During the fiscal year ended December 31, 2020, the following transactions occurred. 1. A business donated rent-free office space to the organization that would normally rent for $35,000 a year 2. A fund drive raised $185,000 in cash and $100,000 in pledges that will be paid within one year. A state government grant of $150,000 was received for program operating costs related to public health education 3. Salaries and fringe benefits paid during the year amounted to $208,560. At year-end, an additional 4. A donor pledged $100,000 for construction of a new building, payable over five fiscal years, 5. Office equipment was purchased for $12,000. The useful life of the equipment is estimated to be five $16,000 of salaries and fringe benefits were accrued commencing in 2022. The discounted value of the pledge is expected to be $94,260 years. Office furniture with a fair value of $9,600 was donated by a local office supply company. The furniture has an estimated useful life of 10 years. Furniture and equipment are considered net assets without donor restrictions by INVOLVE. 6. Telephone expense for the year was $5,200, printing and postage expense was $12,000 for the year utilities for the year were $8,300, and supplies expense was $4,300 for the year. At year-end, an immaterial amount of supplies remained on hand and the balance in accounts payable was $3,600 7. Volunteers contributed $15,000 of time to help with answering the phones, mailing materials, and various other clerical activities 8. It is estimated that 90 percent of the pledges made for the 2021 year will be collected. Depreciation expense is recorded for the full year on the assets recorded in item 5 expense is recorded for the full year on the assets recorded in ltem 5 9. All expenses were allocated to program services and support services in the following percentages public health education, 35 percent; community service, 30 percent; management and general, 20 percent; and fund-raising, 15 percent. 10. Net assets were released to reflect satisfaction of state grant requirements that the grant resources be used for public health education program purposes 11. All nominal accounts were closed to the appropriate net asset accounts. d. Prepare a statement of cash flows for the year ended December 31, 2020. (List of cash outflows should be indicated by a minus sign.) Answer is not complete. INVOLVE Statement of Cash Flows For the Year Ended December 31, 2020 Cash Flows from Operating Activities Cash Received from Contributions Cash Paid to Employees Cash Paid to Suppliers 335,000 (208,560) (26,200) Net Cash Provided by Operating Activities Cash Flows from Investing Activities: 100,240 (12,000) 88,240 Purchase of Equipment Net Increase in Cash Beginning Cash Ending Cash 88,240 Reconciliation of Changes in Net Assets to Net Cash Provided by Operating Activities Change in Net Assets Adjustments to Reconcile Changes in Net Assets to Net Cash Provided by Operating Activities: Depreciation Increase in Net Contributions Receivable Increase in Accounts Payable Increase in Salaries Payable Gift of Furniture 3,360 279,260 3,600 16,000 (9,600) Cash Provided by Operating Activities 292,620 INVOLVE was incorporated as a not-for-profit voluntary health and welfare organization on January 1, 2020 During the fiscal year ended December 31, 2020, the following transactions occurred. 1. A business donated rent-free office space to the organization that would normally rent for $35,000 a year 2. A fund drive raised $185,000 in cash and $100,000 in pledges that will be paid within one year. A state government grant of $150,000 was received for program operating costs related to public health education 3. Salaries and fringe benefits paid during the year amounted to $208,560. At year-end, an additional 4. A donor pledged $100,000 for construction of a new building, payable over five fiscal years, 5. Office equipment was purchased for $12,000. The useful life of the equipment is estimated to be five $16,000 of salaries and fringe benefits were accrued commencing in 2022. The discounted value of the pledge is expected to be $94,260 years. Office furniture with a fair value of $9,600 was donated by a local office supply company. The furniture has an estimated useful life of 10 years. Furniture and equipment are considered net assets without donor restrictions by INVOLVE. 6. Telephone expense for the year was $5,200, printing and postage expense was $12,000 for the year utilities for the year were $8,300, and supplies expense was $4,300 for the year. At year-end, an immaterial amount of supplies remained on hand and the balance in accounts payable was $3,600 7. Volunteers contributed $15,000 of time to help with answering the phones, mailing materials, and various other clerical activities 8. It is estimated that 90 percent of the pledges made for the 2021 year will be collected. Depreciation expense is recorded for the full year on the assets recorded in item 5 expense is recorded for the full year on the assets recorded in ltem 5 9. All expenses were allocated to program services and support services in the following percentages public health education, 35 percent; community service, 30 percent; management and general, 20 percent; and fund-raising, 15 percent. 10. Net assets were released to reflect satisfaction of state grant requirements that the grant resources be used for public health education program purposes 11. All nominal accounts were closed to the appropriate net asset accounts. d. Prepare a statement of cash flows for the year ended December 31, 2020. (List of cash outflows should be indicated by a minus sign.) Answer is not complete. INVOLVE Statement of Cash Flows For the Year Ended December 31, 2020 Cash Flows from Operating Activities Cash Received from Contributions Cash Paid to Employees Cash Paid to Suppliers 335,000 (208,560) (26,200) Net Cash Provided by Operating Activities Cash Flows from Investing Activities: 100,240 (12,000) 88,240 Purchase of Equipment Net Increase in Cash Beginning Cash Ending Cash 88,240 Reconciliation of Changes in Net Assets to Net Cash Provided by Operating Activities Change in Net Assets Adjustments to Reconcile Changes in Net Assets to Net Cash Provided by Operating Activities: Depreciation Increase in Net Contributions Receivable Increase in Accounts Payable Increase in Salaries Payable Gift of Furniture 3,360 279,260 3,600 16,000 (9,600) Cash Provided by Operating Activities 292,620